Time Warner Cable to Merge with Comcast

On February 13, Comcast announced its intent to merge with Time Warner Cable, creating a “world-class technology and media company, differentiated by its ability to deliver groundbreaking products on a superior network while leveraging a national platform to create operating efficiencies and economies of scale.” If approved by regulatory agencies, this transaction would provide Comcast with a national footprint operating in 43 of the top 50 markets in the U.S., including two strategic TWC markets: New York and Los Angeles.

Although Comcast and TWC have proclaimed that this proposed merger is pro-consumer and pro-competitive, in an industry with few players, the approval process will likely be long and hotly contested. We expect Comcast to continue its investment in new IP and cloud-enabled video (e.g., Comcast’s X1 platform) and network infrastructure. And, at the announcement, Rob Marcus, TWC’s Chairman, CEO and President, stated that TWC will continue spending plans for 2014 unabated. Of course, there will certainly be many new developments along the way—witness the latest Netflix agreement with Comcast to guarantee its content delivery.